The deal implies that NetEase now has its first studio in Europe, and comes only a few months after the Hangzhou-based firm launched its first hub in the U.S., positioned in Austin, Texas.
Based in 1997, NetEase has emerged as one of many world’s top 10 gaming companies by revenue, forward of Nintendo and Digital Arts, however behind its arch rival Tencent which sits in pole place. Quantic Dream, in the meantime, launched out of France the exact same 12 months as NetEase did in China, although it has chosen a extra modest path to progress with some 200 employees as we speak and it has remained solely non-public with minimal exterior funding.
Nonetheless, it’s value noting that NetEase — which trades on the NASDAQ with a present market cap of greater than $57 billion — made an undisclosed minority investment in Quantic Dream again in 2019. So as we speak’s announcement that it has gone all-in and acquired the corporate outright maybe shouldn’t come as a serious shock, significantly at a time when NetEase is seemingly on an abroad growth mission.
NetEase additionally invested $100 million in U.S. online game firm Bungie back in 2018, although Sony took Bungie off the menu when it swooped in to acquire the firm in a $3.6 billion deal that closed final month.
Elsewhere, there was a flurry of consolidation throughout the gaming realm of late. Simply this week, Sony announced that it was shopping for Savage Recreation Studios, whereas Take Two recently closed its $12.7 billion Zynga acquisition. And Microsoft’s proposed $69 billion offer for Activision Blizzard is currently facing regulatory scrutiny.
So NetEase’s push into Europe very a lot matches right into a broader development that has seen gaming corporations of all sizes focused by bigger companies on the lookout for a much bigger piece of the $200 billion video game market.
Whereas Quantic Dream has solely made round 5 video games since its inception, final 12 months it introduced that it had been commissioned by Lucasfilm to develop a new game known as Star Wars Eclipse, one thing that will have spurred Netease to go all-in on Quantic Dream. On high of that, rumors recently emerged that Quantic Dream has been struggling to rent for the sport, which is due out a while within the subsequent few years, so having a well-financed company guardian could properly change Quantic Goals’ fortunes on that entrance. In a weblog submit as we speak, Quantic Dream wrote:
With a view to proceed our improvement and presence on the earth, but additionally to fund different studios and grow to be a world writer, bigger investments are wanted for us to maintain constructing our know-how and infrastructure, to ship ever extra spectacular next-generation video games, to develop our workforce and to develop a number of tasks concurrently.
Because of the deal, NetEase stated that Quantic Dream will proceed to function as an impartial entity out of France.